RLJ Lodging Trust acquires SpringHill Suites Portland Hillsboro
RLJ Lodging Trust has acquired the 106-room SpringHill Suites Portland Hillsboro for a purchase price of USD24m, or approximately USD226,000 per key.
The purchase price represents a forward capitalisation rate of approximately 10 per cent on the hotel’s projected 2014 net operating income. The company purchased this asset with cash available on its balance sheet.
“We continue to expand our presence on the West Coast with a great addition to our portfolio,” says Thomas J Baltimore, Jr, president and chief executive officer. “This acquisition is immediately accretive to our portfolio and exemplifies our strategy of investing in premium-branded assets in premier markets.”
The hotel’s prime location in Portland’s submarket of Hillsboro provides the hotel with a wide variety of demand generators. Hillsboro is in the heart of “Silicon Forest”, Oregon’s expanding high-tech region, and is home to Intel’s primary research and development facilities for its worldwide operations. In addition to the prevalence of high-tech firms, the presence of education and health service companies provide a diverse economic base and strong corporate demand. Oregon’s favourable tax structure, high quality of life, and abundance of support amenities around Hillsboro are expected to continue to attract major companies to the area.
The property itself is less than a mile from Intel’s Ronler Acres campus, which is undergoing a multi-phase, multi-billion dollar expansion that is projected to be completed in 2015. The hotel is also within close proximity to other diverse employers in the market, including Nike, Wells Fargo, Farmers Insurance, and Epson Portland. The hotel is within walking distance to a full array of restaurants and retail establishments.
Additionally, the hotel’s all-suite product is an attractive option for leisure travellers. The 7,000-seat multipurpose Gordon Faber Recreational Complex is located approximately one mile from the Hotel. The 90-acre complex is used for a variety of sporting events, special events, and community activities.
In 2011, the hotel underwent a major renovation that included all public spaces and guest rooms and will therefore require minimal additional capital expenditure in the upcoming years
With the addition of this asset, the company now owns 151 properties, comprised of 149 hotels with more than 22,400 rooms and two planned hotel conversions, located in 23 states and the District of Columbia.